The ACT government should come out and say 40 per cent of Canberra families will never be able to afford a house on its own block, former chief minister and affordable housing champion Jon Stanhope has said.
Mr Stanhope told Fairfax the housing affordability action program he introduced nine years ago had failed and maximising dollar returns to the government now appeared to unduly influence land release policy.
He said he may have been gullible in accepting, from 2008 to 2011, that government agencies and directorates were committed to making the affordability action plan work, but that they had never come "within a bull's roar" of meeting some key targets.
This included the creation of a permanent land bank of 1000 house blocks ready for "over-the-counter" sale.
"Nothing frustrated me more [while in government] than the inability of the ACT public service to meet the government's expectations about the implementation of the plan," he said.
"That target [of 1000 blocks] has never been met. There is not even a single block of land available over the counter today."
ACT chief minister Andrew Barr defended the government's performance, saying it was "committed to an adequate supply of housing, from free-standing houses right through to apartments".
"All directorates and agencies work collaboratively to ensure the land release program is delivered in a timely manner," he said.
Mr Barr said the move to abolish stamp duty, already down by $5900 on a $500,000 home, was "the biggest reform to improve housing affordability".
Mr Stanhope said while sustainable development was a delicate balancing act, economic considerations were driving the push to smaller block sizes and the ever increasing number of units.
"It is about land supply, it is about return. I have no doubt about that," he said.
"As the price of land has risen, the size of blocks has come down. There has to be a correlation between the two other than just the desire for densification and a more sustainable city."
He had campaigned for affordable housing in government on the grounds of equity.
"I said that as a Labor government, committed to egalitarianism and with some acceptance of the great Australian dream [of home ownership] and its relevance to people who aren't as well off, we should do everything in our power to ensure all Canberrans had [access to] that," he said.
"That dream was ownership of a detached house, not a fifth-floor, two-bedroom apartment with a balcony."
Such units are now the only home ownership option open to tens of thousands of working Canberra families.
That is unlikely to change any time soon. Mr Barr says that of about 16,900 "dwelling sites" proposed for release between 2015 and 2019, only 4900 would be for detached dwellings. Another 2000 would be for compact block/townhouses. The remaining 10,000, or almost 60 per cent, are apartments.
Mr Barr said the government had sufficient greenfield and infill residential land to meet anticipated demand for the next 60 years.
Mr Stanhope said neither policy makers or the government would admit to creating a two-tiered housing market; one for people above the median income and one for people below.
"If you are lucky enough to have household income above the median [of $2124 in 2012] you can go straight into the detached housing market. If you are part of a household below median income the prospect of ever owning a detached house is disappearing into the distance," he said.
"We are saying 'guys, guess what, you are never going to own a detached house, but we are building all these fantastic apartments for you'."